Hussain, S.; Ali, R.; Emam, W.; Tashkandy, Y.; Mishra, P.; Fahlevi, M.; Matuka, A. Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum. Sustainability2023, 15, 9656.
Hussain, S.; Ali, R.; Emam, W.; Tashkandy, Y.; Mishra, P.; Fahlevi, M.; Matuka, A. Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum. Sustainability 2023, 15, 9656.
Hussain, S.; Ali, R.; Emam, W.; Tashkandy, Y.; Mishra, P.; Fahlevi, M.; Matuka, A. Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum. Sustainability2023, 15, 9656.
Hussain, S.; Ali, R.; Emam, W.; Tashkandy, Y.; Mishra, P.; Fahlevi, M.; Matuka, A. Economic Policy Uncertainty and Firm Value: Impact of Investment Sentiments in Energy and Petroleum. Sustainability 2023, 15, 9656.
Abstract
This study seeks to determine how economic policy uncertainty (EPU) influences investment decisions and the market value of the Pakistan Stock Exchange. The study examines investment and operational data from 249 energy and petroleum companies between 2015 and 2020, in addition to macroeconomic variables such as EPU. This study investigates the moderating effects of EPU on investments in fixed and intangible assets, as well as its effect on Tobin's Q and the market price per share. The outcomes demonstrate that EPU reduces the costs of both tangible and intangible assets for businesses. In addition, companies with a greater Tobin's Q and market price per share are more impacted by uncertain corporate investment policies. However, financial leverage is found to be negatively correlated with share price and positively correlated with earnings per share and earnings per unit. Tobin's Q is positively correlated with financial leverage, indicating that firms that raise capital through debt are more likely to create value for investors. The research indicates that market-dependent enterprises are more susceptible to the unpredictability of monetary policy. Eventually, the findings suggest that consistent and transparent economic policies may increase the efficiency of corporate investment.
Keywords
Economic Policy Uncertainty; Tobin's Q; Market Price Per Share; Investment in Intangible Assets; Fixed Assets; Financial Leverage; Cash Flow From Operations
Subject
Business, Economics and Management, Finance
Copyright:
This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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